With large majority the European Parliament adopted the EREC initiative report on renewable heating and cooling. This report concludes that Europe needs a Directive before the end of 2006, to develop stronger policies for the promotion of heating and cooling from renewables.

Europe is at the forefront of renewable energy development worldwide and has significant experience in the formulation of proactive policy measures in this area. The renewable energy sector is one of Europe ’s fastest growing sectors. However, Europe is only at the forefront of developing markets for sustainable electricity and transport. There is no European legislation that aims to increase the share of renewable heating and cooling production.

In the White Paper of 1997, the EU laid down objectives for renewable energy by 2010: a share of 12% of renewables in energy consumption. In May 2004 the European Commission already stated that ‘the shortfall to the 12% target is caused by sluggish growth of renewable energy markets for heating and cooling (…) considerable extra action is needed in this sector to enable the full 12% target to be reached’. The initial report concludes that the heating sector is a ‘neglected giant’.

Heat is the largest consumer of energy in Europe, being greater than electricity or transport. Almost 50% of the final energy consumption in Europe is used for the heating needs of buildings, for domestic hot water production and for heating in industrial processes. Biomass, solar thermal and geothermal have huge potential for growth and can replace substantial amounts of fossil fuels and electricity currently used for heating purposes.

The Directive shall set a target of at least doubling the share of renewable energy in the heating and cooling sector within Europe by 2020. Now only about 10% of the heating in the European domestic sector is from biomass, solar energy or geothermal energy. According to the initial report the Directive should contain binding targets for the EU Member States with suggested instruments such as tax breaks, financial incentives or regulatory measures and measures to reduce the administrative barriers to the use of renewable heating and cooling.